The Biotechnology Industry Organization (BIO) is pleased to submit the following comments on the Centers for Medicare and Medicaid Services’ (CMS) proposed rule regarding the hospital outpatient prospective payment system (OPPS) and calendar year (CY) 2013 payment rates, published in the Federal Register on July 30, 2012 (the Proposed Rule).[1] BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers, and related organizations in the United States. BIO members are involved in the research and development of health care, agricultural, industrial, and environmental biotechnology products.

As the representative of an industry that is devoted to improving health care through the discovery of new therapies, BIO understands that appropriate reimbursement based on an accurate payment methodology is essential to protecting beneficiary access to care and encouraging continued investment in innovation. BIO strongly supports CMS’s proposal to reimburse separately payable drugs and biologicals without pass-through status at average sales price (ASP) plus six percent under the outpatient prospective payment system (OPPS) in calendar year 2013. This policy will provide the predictable, appropriate payment rates needed to ensure that beneficiaries can receive critical therapies in the appropriate hospital outpatient setting. We urge CMS to finalize this proposal. In addition, we recommend that CMS apply this reimbursement rate to all drugs and biologicals with Healthcare Common Procedure Coding System (HCPCS) codes, including contrast agents and diagnostic radiopharmaceuticals.

In short, we recommend that CMS:

· Implement its proposal to pay ASP plus six percent for separately payable drugs and biologicals administered in the OPPS.

· Make separate payment for all drugs and biologicals with HCPCS codes as it does in the physician office setting or alternatively, not increase the packaging threshold for these therapies. If any drugs remain packaged, CMS should require hospitals to bill for them using HCPCS codes and revenue code 636.

· Classify dosemetric doses used in radiopharmaceutical procedures as therapeutic radiopharmaceuticals and reimburse for them separately.

· Continue to pay for therapeutic radiopharmaceuticals based on ASP data if submitted by the manufacturer and reimburse these therapies at ASP plus six percent.

· Reimburse blood clotting factors at ASP plus six percent.

· Consider implantable biologicals approved under biologics license applications (BLAs) for pass-through status as drugs or biologicals, or, if CMS does not implement this recommendation, revise its regulation to clarify that a biological will be evaluated as a device for pass-through status only if it is solely surgically implanted according to its Food and Drug Administration (FDA)-approved indication.